France subsidizes companies much more than its neighbors, but some of these aids compensate for a heavier taxation.
It is a cost item that is mentioned more rarely when we talk about the generosity of public power. The report published Thursday by France Strategy entitled "Where to reduce the weight of public spending? "Shows the areas in which France is more lavish of its money than its European neighbors. In addition to the social sphere (retirement, health, etc.), one category stands out: the one that the think-tank attached to Matignon calls "subsidies and aid to the economy". The latter are 1.9 percentage points of GDP higher than in 11 Western European countries, and 1.1 point higher if we exclude the CICE (tax expenditure that will disappear in 2019, to be replaced by a decrease in charges).
French cultural exception
It would take several articles to list all these aids, mainly intended for businesses but also for households: subsidized jobs, research tax credit, support for renewable energies, housing or DOM support, investment aid for households companies but also tax credits for the employment of a home-based employee ... The schemes are numerous and are paid by both the State and the local authorities.
We are touching on a French cultural exception. When these aids to the economy represent 4.2 points of GDP in France (excluding CICE), they amount to only 2.7 points of GDP in Germany. Only Italy is closer to France (4.1 GDP points).
Paradoxically, this situation does not mean that the public authorities are particularly fond of companies. These devices can "To be perceived as a means of compensating for excessive taxation of the factors of production", notes France Strategy, in reference to the production taxes twice as high as those practiced in Europe. Gilles de Margerie, General Commissioner of the think-tank, talks about a system of "Suction suction pump", an expression that seems straight from an episode of the "Shadocks".